Uber customer claims company won price-fixing suit because arbitrator was scared

FILE PHOTO: The Uber logo is displayed on a mobile phone in this picture illustration taken November 25, 2019. REUTERS/Hannah McKay/Illustration

May 23, 2020

By Tina Bellon

NEW YORK (Reuters) – An Uber customer on Friday asked a Manhattan federal judge to overturn an arbitration win for the company in a price-fixing case, arguing that the arbitrator only ruled in Uber’s favor because he was scared.

Spencer Meyer initiated the high-profile 2015 antitrust lawsuit alleging that Uber Technologies Inc engaged in an illegal conspiracy with its drivers to coordinate high “surge pricing” fares during periods of heavy demand by agreeing to charge prices set by an algorithm in the Uber ride-hailing app.

Uber takes a cut from drivers’ earnings, and ride-hailing trips in North America make up the bulk of the company’s revenue. The lawsuit sought a nationwide ban against surge pricing.

Uber argues its drivers are independent contractors and that its app is merely a technology platform connecting drivers with riders. Uber on Friday declined to comment on the court filing.

The company has previously said it believed the law was on its side, pointing to the fact that no antitrust agency has raised issues.

The lawsuit went through several courts before it was sent into arbitration in 2019 in accordance with Uber’s terms of service that mandate arbitration behind closed doors for most lawsuits.

The appointed arbitrator, attorney Les Weinstein, on Feb. 22 ruled in Uber’s favor and dismissed the lawsuit, but according to Friday’s filings he did so out of “evident partiality.”

A transcript excerpt of the arbitration, attached to the filing, cited him saying: “I must say I act out of fear. My fear is if I ruled Uber illegal, I would need security. I wouldn’t be able to walk the streets at night. People would be after me.”

Weinstein also questioned whether he had the legal power to ban surge pricing nationwide. He did not immediately respond to a request for comment.